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Citadel Capital to Go Public

The Middle East and Africa's leading private equity firm will list its shares on the Egyptian Exchange (EGX) in a move that underscores Citadel Capital&'s commitment to transparency and creating value for shareholders and limited partners alike

Monday, November 23, 2009

Qalaa Holdings (S.A.E.), the leading private equity firm in the Middle East and Africa with US$ 8.3 billion in investments under control, announced today that it will list its shares on the Egyptian Exchange (EGX).

The listing will not include the offering of new equity in the firm at this time.

“We are about to enter what we believe will prove to be another outstanding vintage year for private equity investments,” said Citadel Capital Chairman and Founder Ahmed Heikal. “It is time for decisive investors with proven strategies to embark on the next wave of deals that will generate strong returns. This listing will give Citadel Capital new flexibility in accessing equity capital markets at a later date, furthering our ability to invest in our own deals as a principal investor.”

Citadel Capital, which typically invests 10-20% of the equity in each of its deals alongside leading regional and international limited partners, is presently exploring new investments in Saudi Arabia, Iraq, North and East Africa, as well as Egypt, Heikal noted.

In the five years since it began operations, Citadel Capital has generated more than US$ 2.4 billion in cash returns for its limited partners on investments of US$ 650 million (more than any other private equity company in the region) and has grown to become the largest private equity firm in Africa. It has executed the largest private equity deal in the Middle East and North Africa to-date, the US$ 1.4 billion sale of Egyptian Fertilizers Company.

Citadel Capital Partners, the vehicle through which senior management holds its equity in the firm, is not selling any shares at this time.

“Management is not selling,” said Heikal. “Listing on the EGX will make it easier for Citadel Capital to raise its own capital in the future, thereby enhancing our ability to be significant principal investors in our own transactions. This is a key component of our business model that ensures Citadel Capital’s interests are fully aligned with the interests of our limited partners in each and every one our investments.

“Moreover,” Heikal continued, “listing creates liquidity for existing financial investors in our firm at a time when that liquidity is becoming of greater importance than ever before.”

Citadel Capital, which takes a flexible approach to private equity investing through the raising of Opportunity-Specific Funds (OSFs), invests across the Middle East and North and East Africa. Today, its 17 OSFs control Platform Companies across 12 nations and 14 industries including mining, cement, transportation, food, energy.

“Instead of relying on leverage to generate returns, Citadel Capital has always focused on deploying equity capital and smart levels of debt to create value for shareholders and limited partners alike through the patient building of Platform Companies with regional scope, allowing us to generate superior returns at exit,” says Citadel Capital Managing Director and Co-Founder Hisham El-Khazindar.

“To help our shareholders better understand the firm’s performance,” he continued, “we will publish guidance on what we see as the net asset value of our portfolio on a semi-annual basis. The NAV of our Platform Companies is just one component of the value of Citadel Capital and does not take into consideration management’s proven track record at sourcing and executing compelling deals or revenues generated from the asset management aspect of our business, such as carried interest, among other factors.”

Citadel Capital will announce its stock symbol and confirm a listing date in the coming period.

—Ends—

Citadel Capital is the leading private equity firm focusing on building regional platform investments throughout the Middle East and Africa in selected industries through acquisitions, turnarounds, and greenfields executed via Opportunity Specific Funds. Citadel Capital’s 17 OSFs now control Platform Companies with investments worth more than US$ 8.3 billion in 14 industries, including mining, cement, transportation, food and energy. Since 2004, the firm has returned more than US$ 2.4 billion in cash to investors, more than any other private equity firm in the region. Citadel Capital is the largest private equity firm in Africa by PE assets under management (2004-2009, as ranked by Private Equity International). For more information, visit www.citadelcapital.com.